Turkey & Moody's meeting positive

ANKARA, July 28, (RTRS): Turkey had a positive meeting with Moody’s and the ratings agency “appreciates” the government’s fiscal discipline, Finance Minister Naci Agbal told Reuters in an interview on Thursday.

Turkey is on the backfoot after rival ratings agency Standard & Poor’s cut its sovereign debt rating further into junk territory last week and changed its outlook to negative, citing political concerns following a failed military coup this month.

While the impact of S&P’s downgrade was limited because it already had a junk rating on Turkish debt, investors are concerned that Moody’s and Fitch could cut their ratings to below investment grade as soon as next month.

“Today I had a positive meeting with Moody’s officials, they welcome and appreciate our fiscal discipline, I told them we would maintain that discipline,” Agbal said. “I think the step S&P took was hasty, and I believe that the final evaluations by Moody’s and Fitch will be positive. There is a great deal of harmony between the suggestions of Moody’s and Fitch for the Turkish economy and our government’s targets.”

A faction of the Turkish military attempted to overthrow the government on July 15-16, but the putsch crumbled as large numbers of Turks responded to an appeal from President Tayyip Erdogan to rally in support of democracy.

However, investors have been spooked by the scale of a crackdown on supporters of US-based Muslim cleric Fethullah Gulen, accused by Ankara of masterminding the coup.

Tens of thousands of people — including police, judges, journalists, academics and teachers — have been suspended or placed under investigation since the abortive putsch. Gulen denies involvement in the coup.

S&P said political polarisation had further eroded Turkey’s institutional checks and balances.

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ISTANBUL: Turkey’s biggest petrochemicals company Petkim said on Thursday its chief executive had resigned, and the state-run news agency said he had been detained in connection with a failed coup.

Petkim, owned by Azerbaijan’s Socar, said in a stock-exchange filing that Anar Mammadov has become CEO after his predecessor, Saadettin Korkut, resigned.

A spokeswoman at the company, based in Aliaga, Turkey, confirmed Korkut’s resignation but declined to comment on the reports of his detention. She also said about 25 Petkim employees have been suspended but did not elaborate.

State-run Anadolu Agency said Korkut was detained at his home in the city of Izmir late on Wednesday and his offices at Petkim were raided.